One source of confusion is the failure to distinguish inequality of
opportunity from inequality of situation (wealth, income etc.). While is
it easy to agree on what is the ideal inequality of opportunity (none)
there is no inter-subjective agreement on what is the ideal inequality
of income (wealth). With respect to the inequality of income (wealth)
one should also distinguish inequality in the world (i.e. across
countries) from inequality within countries.
of income (wealth) should not be confused with attempts to reduce
poverty. Same policies aimed at rich people would increase poverty via
reducing the speed of economic growth. In assessing high incomes one
should distinguish their source: inheritance, rent seeking, crony
Important inequalities of income (wealth)
stem from the wrong policies (e.g. in education, from state-imposed
monopolies, restrictive zoning, etc.) but it is free markets that are
commonly blamed for the rise in inequalities. Inequalities in power,
especially pronounced in despotic regimes, are too often ignored.